BPF calls for tax reforms on bulk property buying

Property tax on bulk purchases is stifling potential activity from professional landlords which could boost the rental sector amid the recession, an expert has suggested.

According to Peter Cosmetatos, director of finance and investments at the British Property Federation, property tax should be reformed in next month's Budget to provide a greater incentive for investors to consider linked transactions.

Landlords buying a block of flats or a row of houses currently face a stamp duty land tax (SDLT) charge of four per cent if the total acquisition costs more than £500,000.

Mr Cosmetatos believes property buyers should instead be charged SDLT at a marginal rate equivalent to each individual unit.

This, he argued, could encourage investors to snap up more property and might lead to an improvement in management standards.

"People [would be] buying apartment blocks or rows of houses or large quantities of housing together, where they can manage them professionally and with greater proficiencies of scale,"Mr Cosmetatos explained.